Archive for January 1st, 2013
The House will vote to amend the bill. It will get no Democratic votes, and I wonder if it gets 218 votes at all. If the amendment does not pass, I doubt the bill itself will pass. Eric Cantor, the #2 Republican in the House, and the likely next Speaker (more on that in a moment), has said he opposes the bill.
So let’s assume that the House amends the bill and passes it. The Senate is gone. It’s business is done for the year. The 112th Congress, Senate edition is over. So that’s it. The bill dies. We are off and over the cliff.
Words cannot express how shocking and yet completely predictable this is. Remember, the House GOP, through Boehner, cut off negotiations with the President two weeks ago, and they planned to pass a “Plan B” bill to raise taxes on only those making over a million dollars. Speaker Boehner led this effort, but a majority of caucus refused to vote for it. Pursuant to a GOP rule called the Hastert Rule, which holds that no legislation shall receive a vote on the floor of the House unless a majority of the GOP caucus supports it, Boehner was forced to pull the bill. In essence, there was a tea party coup against Boehner at that moment, led by his own #2, Eric Cantor.
Humiliated and weakened, with his career over, Speaker Boehner then tried to pass the buck to the Senate, saying the House will not vote on another Fiscal Cliff package unless and until the Senate reaches an agreement, passes it, and sends it to the House. Nevermind that this is unconstitutional, since all revenue bills must originate in the House first, the Senate inexplicably complied, and reached a last minute agreement negotiated by Vice President Biden and Minority Leader Mitch McConnell, and they passed it by an overwhelming bipartisan margin, 89-6. Yes, Boehner demanded that his Senate Republican colleagues go out on a limb and vote for a deal, and surprisingly they did.
So the Senate bill is sent to the House, with Boehner lobbying his caucus in favor of passing it, and his caucus, once again under the true leadership of Eric Cantor, revolted again, refusing to vote for it unless it is amended to suit their desires.
To call the House GOP petulant temper tantrum throwing children is to insult petulant temper tantrum throwing children.
So the deal is dead. Lord knows what happens now. 1 trillion in sequester cuts (half to defense and half to non-SS/Medicare/VA domestic spending) are not in effect. The Clinton tax rates on income, dividends and capital gains are in affect. All 2009 stimulus measures like college tuition tax credits, unemployment insurance and the AMT and Medicare doc fix are rescinded. The Farm Bill extension is dead, which means dairy prices triple. Speaker Boehner is likely to be defeated by Eric Cantor for the Speakership on Thursday.
Happy New Year.
Of the the 8 Senators voting against the Biden-McConnell deal, one of them was our own, very special Tom Carper. What was his chief complaint? It raised taxes on the rich? The deal did not cut spending? The deal did not eliminate or cut Medicare or Social Security. He hates the unemployed and wants to cut all unemployment insurance. I am very curious to hear his reasoning.
In the grand scheme and in context, and considering that I want the sequester cuts to go into affect (because it cuts 500 billion from the Defense budget and unless we let those cuts go into affect automatically, we will never get that much cut from the Pentagon budget ever), it is not a bad deal. It is not a good deal either, as the Democrats caved on indexing the Estate Tax to inflation. Going from 250k to 400k? Meh, I can live with that. Payroll tax holiday not preserved? That’s the bad part of this deal, in my opinion, along with the estate tax indexing.